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As the Terran Alliance was desperately trying to quell various uprisings in the colonies during the Outer Reaches Rebellion, the Alliance Parliament ordered all loyal worlds to increase their production of materials and resources to cover its losses. The reason for the increased quota was simple - the large population of Terra had long ago outstripped its ability to produce enough raw material and food for itself.

With the increased quotas of 2237, the verdant garden world of New Avalon was ripe for rebellion. Protesting the new quotas, the colonists tore down and burned the Alliance pronouncements as an act of defiance. The people were barely able to produce enough food for themselves let alone the starving billions of Earth.

Unwilling to disobey orders, Fleet Rear Admiral-turned-Governor-General Emil Varnay decided fulfill his duties from the Parliament instead of listening to his advisers. Varnay ordered his military forces to gather the shipments and escort them to the spaceport.

Angry colonists stormed the spaceport and, despite heavy casualties, seized the foodstuffs scheduled for export and sabotaged the ships, preventing further shipments to Terra. Governor-General Varnay fled the planet with just a few of his senior staff and the Vice-Governor surrendered the government peacefully to the protesters.[1]

Due to the political upheavals already underway between the Liberal and Expansionist Parties of the Alliance, Varnay was unable to effect any change or response to the rebellion on New Avalon. Varnay was quietly retired.[1]

Grain Rebellion Day is still celebrated on New Avalon with parties, feasts, costumes and reenactments. The reenactment has been likened to a children's game of "Rangers 'n Bandits", while the feasts and parties are similar to ancient Mardi Gras, with costumes ranging from lewd to scary. Solemn speeches and religious observances are held by the politicians and priests in honor of the souls that died in the Rebellion.[1]